Sample Chapter

“Money is only a tool. It will take you wherever you wish, but it will
not replace you as the driver.” —Ayn Rand

MY MONEY MOTTO: MONEY IS A MEANS, NOT AN END

Raise your hand if you would like more money (or just keep reading).

Keep your hand raised if you have a clear idea of what values money
allows you to honor. If you’re like most people, you probably
haven’t thought too much about the second statement.

Money is a means, not an end; it is not about buying stuff—it is about
what that stuff can ultimately create for you. After taking care of our
basic necessities, it doesn’t mean very much to have or spend more
money if you don’t know how those actions will make your life better.
At the end of the day, what value do you hope that stack of bills (or
fancy new purchase) will add to your life?

For example, I scraped together every penny I had to buy a condo when I
was 24 years old. It meant signing a 30-year mortgage—a big commit-
ment for a young person, especially considering I still don’t know
where I will want to live in 2 years, let alone 30.

So why did I buy the condo, when for many this responsibility would feel
overwhelming and burdensome? Because it honors a key value of mine:
independence. Living on my own and supporting myself are very important
to me, and the condo helps me build equity to support my financial
future. If I valued spontaneity more, I might have made a very different
decision, such as traveling the world for a year (which also sounds
fantastic!).

Remember that wealth comes in many forms. Hopefully at the end of our
lives, we will all be made far richer from relationships and experi-
ences than by the dollars in our bank accounts. Money can certainly help
you experience new things and achieve some of your goals, but it is not
everything. Not even close.

JENNY’S TIPS

Conduct a “State of the Union” for your finances and sign up for an
online money management system.

• It is critical that before you graduate (and forever after) you have
a complete understanding of your financial situation. You should know
how much you will owe on student loans, what your monthly payments will
be, whether you have any credit card debt, and how much your bills and
other expenses (like rent) will be each month.

• I also recommend signing up for a money management tool online for
monitoring your accounts and tracking spending. My favorite is Mint.com
because you can access it from almost anywhere (and opt-in to weekly or
monthly reports), and the interface is clear and easy to use.

Develop sound saving habits from the start.

• Set up an emergency fund and a long-term savings account (I use ING
Direct), with automatic direct deposits from your regular checking
account. Even if you only contribute $10 per month to each, it will
start you off on the right foot and help you develop strong saving
habits. Once you get your first job, you will already have a system in
place for saving money.

Be mindful about your money.

• Life is a classroom. We make mistakes so we can learn and grow from
them, and hopefully avoid the same ones in the future. Take some time to
learn from your current financial situation—what are you doing well?
Where can you improve?

• While saving is important, you work hard so you can enjoy life and
spend money on things that are important to you. Find a balance between
saving and enjoying your hard-earned money.

• When hanging out with friends, be mindful of the varying range in
salaries. If one person is making big bucks as a consultant or invest-
ment banker, and another is barely scraping by as a teacher, don’t eat
at the most expensive restaurant in town.

• Do your research before making major purchases. Read reviews, check
prices online and in stores, and find out about service plans, warran-
tees, and return policies in advance.

• There is no shame in moving back in with your parents after gradua-
tion, especially if it will help you save money, and better still if it
helps you develop good saving and spending habits.

•If you do move home after graduation, review with your parents
whether they expect you to pay rent and other expenses like groceries.
If not, save at least 50% of your salary as a benchmark (or save the
approximate rent you’d be paying in your area plus 15%).

• Budgets can be overwhelming. Focus on four key monthly numbers:
total income, money allocated to saving, “must-have”expenses (bills,
rent, food), and “nice to have”expenses (drinks with friends, nice
din- ners, new clothes). Anything left over is yours to spend! (See the
exer- cise at the end of this chapter for help setting up a very simple
budget.)

Save, save, save. Start by setting up an emer- gency fund and a
retirement savings account.

• If your company offers a 401(k) plan, JOIN. If they match, do every-
thing you can to max out their contribution. It’s free money!

• You don’t achieve financial success overnight, which may make
saving seem hard or impossible. Start small and go in increments—save
5% of your paycheck to start, then bump it up to 10% in 6 months, and
maybe even 15% 6 months after that.

• Everyone should have an emergency fund for rainy days, unexpected
car repairs or unexpected anything. A good rule of thumb is 3 months
living expenses. If that’s not doable, shoot for at least 1 month.

• Be disciplined about your emergency fund. Don’t dip into it for
small or frivolous things—it is a slippery slope that will defeat the
purpose of having a back-up account in the first place.

Leverage the power of compound interest.

• Compound interest is an incredibly powerful financial concept. The
ear- lier you start saving, the more your interest your money will earn,
which over the long-term will snowball far beyond your original
investment. The longer you wait to start saving, the harder each penny
has to work.

• For example, if you save $1,000, and it earns 10% interest per year,
you now have $1,100. Without saving another dime, when you multiply
$1,100 by 10% the next year, you end up with $1,210 (you’ve earned
$210 through compound interest). In five years, you’ll have $610 of
extra money without ever having added any money beyond your original
investment. (For an online compound interest calculator, visit Young-
Money.com.)

Automate your financial processes to make life easier.

• Direct deposit is a must—before you ever spend a dime, make sure
part of every paycheck is directly deposited into a retirement account
AND an emergency fund.

• If your bank has Bill Pay, use it—the bank will send checks to
payees regularly or when you tell it to. This works great for paying
rent because you don’t have to remember to write a check every month
or worry about being late—the bank will write and send the check for
you.

• For bills that are the same every month, you may want to opt-in to
their auto-pay option if that’s an option. I do this with my utility
bill, but have a limit set. If the bill is higher than $20 (my monthly
average is about $15), the system sends me an e-mail instead of paying
the bill.

• For bills that vary more from month-to-month or that you want to
keep a close eye on (like cell phone bills), you may not want to
automate pay- ment. See if you can at least set up an e-mail alert to
notify you when the next bill is due. That way you can check to make
sure everything looks correct (and dispute anything if necessary) before
paying.

• Use monthly e-mail notifications as a to-do list for your bills.
File the e- mail once the bill is paid.

When things get financially rough, your first instinct may be to ignore
your credit card bill and bank accounts, and hope things get better.
They won’t. Hiding from your financial problems only makes a bad
situation worse.

• Use credit wisely and pay your credit card in full every month.
Period.

• If you have a shopping or spending weakness, set up another bank
account for that category of spending. Have money direct-deposited into
that account (for clothes or trips with friends) and only spend what you
earn in that account.

• Small expenses add up quickly—lunch here, coffee there. Be aware
of how much you are spending on small purchases each month and adjust if
necessary.

• Check your credit reports from all three major agencies once a year
(I use AnnualCreditReport.com). If anything looks suspicious or wrong,
make sure to call the credit agencies and investigate.

• Some purchases are worth spending extra money on; things you will
use frequently (a cell phone or camera) or more expensive models that
will perform substantially better than their lower-priced counterparts
(like computers).

Life After College 94

Money 95

• To keep spending under control, make a list of big purchases you
want to make in the next 6 months to 1 year. Prioritize the list in
order of importance, then buy the items in that order. Adjust if you
change your mind.

• If you are a big weekend spender, give yourself a budget in cash
(rather than using your credit card)—it will make you more aware of
how much you are spending throughout the weekend.

• Credit cards, while often abused, can make tracking your spending
much easier than tracking cash. If you can learn to spend within your
means, using your credit card often is not a bad thing. (I use Mint.com
online and downloaded the Mint app to my phone. The spending
distribution pie charts are amazing!)

Don’t let pressure to buy extravagant gifts break your bank account.

• Extravagant gift-giving can escalate quickly—someone gives you a
gift that would be out of your price range, so you feel compelled to
match the cost when you reciprocate. This can go on for years, where one
or both of you is stretched beyond your comfort zone. Set a limit for
gifts and stick to it; thoughtful and creative gifts are more meaningful
anyway.

• Holiday gift-giving can be tough on everyone’s budgets—arrange
to do secret Santa with friends or family (where you each pick a name
out of a hat and only buy one nice gift), or agree on a spending limit
that works for everyone.

• If you are short on money, get creative! Tutoring in something you
are good at is a great way to generate extra income.

Not all debt is created equal.

• If you have debt—look at your interest rates. Credit card debt is
the most urgent; student loans can wait because the interest rates are
typ- ically much lower.

• Student loan debt often has the lowest interest rates of all, and in
some cases, it doesn’t make sense to pay them off completely right
away if that money could be earning more in the stock market or a
high-yield savings account. Just make sure you continue chipping away at
your monthly payments.

• Do whatever it takes to avoid late fees and finance/overdraft
charges. In some cases, people spend more on fees than the majority of
their actual purchases.

Slip up? Seven tips for getting out of debt and getting back on
financial track:

1. Face the facts. Look at your finances line by line and figure out
exactly how much you owe. Figure out exactly how much money you have
coming in (income, reimbursements from work, IOUs, side jobs) and
calculate the difference. That’s the debt amount—the part you will
need to get creative with.

2. Prioritize your debt. Create a plan for paying off debt with the
high- est interest rates first. For example, credit card debt is by far
the worst, whereas student loans can wait.

3. Cut back to only essential expenses. Know that it won’t be forever,
but commit to at least two weeks of bare-bones spending. Those two weeks
will be hard, but they are the most important if you want to start
breaking your bad spending habits.

4. Generate additional sources of income. Tutoring in something you are
good at is a great way to get some extra income. Less flexible but more
reliable would be actually getting a second job. Ask for help from
family (if that is available to you), especially if it means not
spiraling into further debt because of exorbitant interest rates.

5. Figure out how to pay yourself back. Getting out of credit card debt
will feel great—and that should be your first priority. But it is
every bit as important to strategize and take action toward restock- ing
your emergency fund and other savings accounts too.

6. Reset your financial goals; plan for the future. Make sure you
aren’t just playing defense when it comes to personal finance. Reset
your goals (and readjust as necessary depending on what is realistic).
Make a plan for saving up for things you will remember buying and
doing—like traveling—that are aligned with your values.

7. Reflect on what you’ve learned. Arguably the most important step:
look at what got you into debt and take action so it doesn’t happen
again.

It is never too late.

The most important thing I want to tell you about money is that you can
get a handle on it. If you are looking for a place to start, I suggest
the fol- lowing:

1. Admit your fears and flaws. What are you afraid of? What are your
biggest financial weaknesses? What do you avoid when it comes to
managing your money? (Check out the exercise later in this chapter
called The Emotional Side of Money.)

2. Raise your Awareness. What is your current state of affairs? How much
money do you have in the bank? How much debt? What is your monthly
income and outflow? This chapter also includes a Four-Step Budget
exercise to help you get this figured out.

3. Start somewhere. At the very least, sign up for Mint.com so that you
know where your money is going. Next step? Set up a short-term savings
account and start having $50 automatically deposited every month for an
emergency fund.

DEEP DIVE: ARE YOU CLOGGING YOUR FINANCIAL ARTERIES?

“The chief cause of failure and unhappiness is trading what you want
most for what you want now.” —Zig Ziglar

Crisp, sugary-sweet bacon. Hot, deliciously salty French fries. Food so
mischievously tasty that you close your eyes as you savor those few sec-
onds of blissful indulgence. So bad . . . but OH. SO. GOOD.

Most of us know what foods are particularly bad for us, but at times we
still fall into the trap of short-term pleasure at the expense of
long-term health (we are, after all, only human). We know that fatty,
greasy foods corrode and clog our arteries. But the catch is that they
do it slowly. If there were instant “artery clogged!” flags or side
pains for every French fry consumed, it might be easier to say no. But
instead, we say yes— hoping that in 30 years our arteries won’t be
that bad.

So how conscious are you when it comes to spending money? How are your
short-term habits contributing to your long-term goals? Are you clogging
your financial arteries for the sake of fleeting indulgences?

We all have our financial weak spots. Here are some seemingly innocu-
ous habits that may be slowly clogging your financial arteries:

• Regularly purchasing items you don’t need or that you don’t use.

• Spending money before you’ve earned it (“I will be rich one
day” or “I have a big paycheck coming, so I will spend as though I
have it already”).

• Spending large portions of your income or spending excessively on
things that don’t ultimately enhance your quality of life (for
example: spending $100 on drinks at the bar. Was it really necessary?).

• Letting cable or cell phone companies overcharge you because you
don’t pay attention to your bills before paying them.

• Justifying purchases you know you shouldn’t make by saying
“I’ll fig- ure out how to pay for it later.”

This is by no means a comprehensive list. It is meant to get you
thinking. What spending (or nonsaving) habits of yours are not
contributing to a healthy financial future?

For many of us, principles of healthy eating are easier to conceptualize
than healthy spending. So the next time you find yourself about to make
a stupid financial decision—yes, you heard me, stupid—stop and ask
yourself what the nutritional equivalent would be. Ten doughnuts? A
bucket of Kentucky Fried Chicken? A quarter pounder with bacon? And then
ask: is it still worth it? Or to reference Ziglar, are you trading what
you want most (for example, financial health and security) for what you
want right now?

ADVICE FROM COLLEGE GRADUATES

Figure out your finances first. All too often we graduate, get a job,
and just assume that it’ll all figure itself out. It’s easy to get
tricked into thinking that you are making a lot of money because most of
us in college were not pulling in these kind of paychecks, but with more
money comes more expenses, like rent, cable, utilities, and food which
all tend to be much more costly than you think. —Vanessa M., USC

That “thing” that’s keeping you awake with excitement at night
probably isn’t your next fat paycheck in and of itself, but the
freedom that comes with that paycheck. Aim for the freedom, not the
check. —Eve Ellenbogen, Binghamton University (SUNY)

AVOID CREDIT CARD DEBT!!! You may have the money today to pay for the
things that you put on your credit cards, but the job market is so
volatile, that things can change in the blink of an eye. There is
nothing more stressful than being out of work, and missing payments and
watching as your credit score is lowered each day. That will haunt you
for a long time. —Kristi R., St. Edward’s University

After saving frantically for years, I realized, “You can’t take it
with you!” Learn how to live for today. —Ginny B., Long Island
University

Don’t consistently borrow money from your parents. When you’re first
getting set up, it’s all right to borrow money . . . how else would
you do it? But as soon as you can, cut the umbilical cord. For me, my
relationship with my mother has improved because money is never a topic
between us. I love having my own money and not needing to rely on
someone else.

—Alison H., Bard College

DEEP DIVE:

LITTLE WHITE FINANCIAL LIES

You might be perfectly rational when it comes to spending money. But
juuust in case you’re not, let me share a little story about my coffee
habit, then tell you how it relates to the little white lies we tell
ourselves when spending money.

A little backstory on my love for coffee and how I talk to myself like a
crazy person

One day I’m driving to work. I’m in a great mood. I approach
Starbucks, which much to my chagrin AND my delight is directly en route
to my office. My internal debate begins: “Should I go?” “No! Make
a latte at work” “But I want Starbucks!” “You work at Google,
land of the espresso machine! Don’t you DARE pull over.”

I veer off at the last minute. I deserve an iced latte. I’ve worked
hard and it’s hot outside. I get to the register. I also buy a
breakfast sandwich. My total comes to $6.40. “No biggie, I mean, I
would have spent at least $15 on brunch with friends anyway.” “But
it’s Tuesday!” “Fine—then I’ll make up for it over the
weekend.”

Do you think I made up for it that weekend? Definitely not. In fact, I
rubbed it in my conscientious frugal-self’s face by visiting Starbucks
three times in one day! I visited Starbucks 146 times in the last year
for a total of $889. Ouch.

I get that I’m talking about Starbucks here. A small purchase, given
that I could be impulse-buying flat-screen TVs. But I don’t think it
matters— I think the white lies we tell ourselves are similar on
purchases big and small. Below are three big ones of mine, along with
some strategies for refuting them.

WHITE LIE #1: THE COUPON MENTALITY—IT’S OKAY THAT I SPENT $X BECAUSE
I COULD HAVE SPENT $Y.

Example: It’s okay that I bought a $500 TV I didn’t need. It was on
SALE.

Why We Tell the Lie: It makes us feel better. We spend money we prob-
ably shouldn’t, then reassure ourselves by focusing on how much more
we could have spent in some hypothetical scenario.

How to Counterbalance: When you notice yourself engaging in the
“coupon mentality”—offer up a counter argument. On the Starbucks
example, I’ve learned to remind myself “but you could have also made
coffee at home for FREE.”

WHITE LIE #2: I’VE EARNED IT! (OVER, AND OVER, AND OVER AGAIN)

Examples: I can buy this new pair of shoes—I’ve EARNED it. I’ve
also earned an amazing meal, $50 worth in drinks with friends, and a new
haircut. And my 3 times per day Starbucks habit.

Why We Tell the Lie: Because we want to reward ourselves for working so
hard! Totally justifiable. But how many times have you “earned” what
you are spending money on? I am all for spending money on things that
make you happy, and for celebrating your hard work. We work so that we
can enjoy our lives. Just be careful about how often you use this
excuse. Have you really earned the 100th thing on your credit card
statement?

How to Counterbalance: If you are working and saving money, that
definitely earns you some splurge/reward purchases. Plan them in
advance. Make sure that your “I’ve earned it” purchases aren’t
impulse buys—that they are items or experiences you really want.
Another tried- and-true trick that your parents might have used when you
were grow- ing up: count the value of the item you are considering in
work hours. These shoes cost two hours; this TV costs one week. Is it
still worth it? If so, and you have the money, go for it!

WHITE LIE #3: IT’S FINE THAT I OVERSPENT— I WILL TOTALLY MAKE UP FOR
IT LATER.

Examples: I’ll order this $50 item online (during the week) and go out
to one less dinner this weekend.

Why We Tell the Lie: It is the true procrastinator in all of us—why
pay now or hold ourselves back today when we can just make up for it
later? The catch here is that by the time “later” rolls around,
we’ve conve- niently forgotten about the IOU we made with ourselves,
which inevitably catches up with us (and our credit card bills) later.

How to Counterbalance: Work in the other direction—save your money
first, then spend it once you’ve earned it. Don’t make promises to
your- self that you know you won’t keep. When you find yourself saying
“I’ll make up for it later” pause for a second and ask yourself
again, “Will I really?” If you are genuinely committed to making a
trade-off in future spending for a purchase now, that’s great—find a
way to hold yourself accountable. Maybe even stick an IOU to your
bathroom mirror as a reminder of how much less you should be spending
over the weekend or on next month’s purchases.

Your Turn to Fess Up: What are some of the little white lies you tell
yourself when spending money? What are some reminders that will help you
counterbalance them?

Goals are specific, measurable objectives that you want to achieve by a
cer- tain time. While some goals are solely money-based (save $10,000 by
the time I’m 25), most are more general. Many life goals have a
financial com- ponent (like buying a car or going to graduate school).
The purpose of this exercise is to brainstorm as many goals as you can
for each category; give yourself a range of fun, adventurous, and
serious goals. For each goal, esti- mate the cost or dollar amount
needed. You may want to continue where you left off with the goal
brainstorm from the first chapter.

For each time period below, brainstorm goals around purchases, earn-
ings, and savings. For example:

1. Outgoing: sign-up for a a yoga/river-rafting retreat during the sum-
mer at a cost of $1,000.

2. Incoming: generate extra income by coaching clients outside of work
for an amount of $200/month.

Money is like food—we all have our weak spots. Some of us spend money
emotionally. Some live in fear about money. Some have no fear! It is
impor- tant to identify what your unique financial strengths and
weaknesses are so you can start to address them and move toward
financial freedom.

The purpose of this exercise is to examine your beliefs and emotions
toward money so you can see how they may be affecting your saving and
spending habits, and identify areas for improvement.

What is important to you about money?
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________

What emotions do you associate with money?
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________

What lessons did you learn about money from your family growing up
(“good” or “bad”), both directly and from observation?

In what ways do you manage money well?
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________

What are some specific ways you could manage your money better?
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________

Describe your ideal financial picture. How are you making money? How are
you managing it? How are you spending it?

What area of financial management or spending concerns you most?
________________________________________________________
________________________________________________________

________________________________________________________
________________________________________________________ What one action
could you take today to improve in this area?
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________

My hope for all of us

What I want most for myself, for my friends, and for all of you is to
see money as a source of freedom, not imprisonment. Of empowerment, not
guilt or shame. Of conscious choices, not feelings of frustration or
igno- rance. No matter where you are starting from today, I know that
you can do it.

Forget for a minute about how much money you have. I wish I could look
you square in the eyes, but for now just hear me say: you are priceless,
no matter what your bank statement says. You are smart, creative, and
resourceful. There is nothing you can’t figure out. Even this.
Especially this.

EXERCISE: THE FOUR-STEP BUDGET

Detailed budgets can be difficult to create and even more challenging to
maintain since they seem to stretch over what seems like a long period
of time (at least one month) with lots of moving parts (most budgets
have dozens of categories like shopping, groceries, utilities, etc.). To
top it off, unplanned vacations or big purchases can throw the whole
thing out of whack and leave you feeling discouraged and disor- ganized.

Enter the four-step budget. You might find it easier to break your
budget down into three manageable chunks: income, outgoing must-have
expenses, and outgoing nice-to-have expenses. Then you are left with an
allowance that you can spend however you choose. This process is much
simpler than trying to remember specific budget amounts for dozens of
areas. (You can find an online spreadsheet version of this exer- cise in
the Templates section of my website at LifeAfterCollege.org.)

How to calculate your monthly spending allowance:

1. Add the take-home amount of your paychecks (and any other sources of
income) within a given month to get your total income.

3. Add up your nice-to-have expenses (things you really like to do/have
each month but ultimately could live without, like coffee, personal
grooming, and other recurring purchases).

4. Subtract the total from steps two and three from the total in step
one to get your monthly spending allowance.

EXERCISE: AN ALTERNATIVE TO THE SIMPLE BALANCE SHEET— WEEKEND BUDGETS

If I were to graph my spending over the course of a week, I would see a
graph that looks like a mountain range—low, low, low Monday through
Friday followed by a HUGE spike on Saturday and Sunday.

After holding back all week (save for a few online book purchases), my
credit card explodes into the retail world on weekends, spending on
breakfast, lunch, dinner, clothes, movies, drinks, you name it. Sound
familiar? It might if you are used to working and laying low during the
week, then splurging on weekends.

Enter the weekend budget.

If you have trouble tracking and following a monthly budget, experi-
ment with a weekend budget instead. You may find it easier to break your
budget down into smaller chunks of time.

2. Divide the remaining amount by four. This is your weekend budget.
Spend on whatever you would like each weekend as long as you stay within
this amount. If it helps, take that amount out of the bank in cash and
distribute that across your weekend activities.

In addition to more closely monitoring the money you spend on week-
ends, make a point to brainstorm fun things to do with friends that
don’t cost a lot of money (bike rides, hiking, volunteering, cooking
dinner instead of going out, etc.).

DEEP DIVE: LIVING CREATIVELY

“All the breaks you need in life wait within your imagination,
Imagination is the workshop of your mind, capable of turning mind energy
into accomplishment and wealth.” —Napoleon Hill, Author of Think and
Grow Rich

Life takes creativity. Solving problems takes creativity. Seeing the
posi- tive side of failures and setbacks takes creativity. I can’t
think of an area of life that doesn’t take creativity.

So how can you practice living with creativity? It starts with
curiosity. Think of some current challenges in your life. Examples might
include feeling tired, wanting to lose weight, being worried about
finances. List them first as problems, then take some time to turn them
into questions (it helps to actually write them down). How can I
increase my energy? How can I lose weight? How can I make extra income?

Reframing issues as questions invites your creative side to participate
in the conversation. Even if you don’t have the answers right away,
your brain has an assignment—something to chew on rather than worry
about.

This worked particularly well for me one summer; after purchasing a
number of plane tickets in the same month, I knew I would be about
$1,000 short of being able to pay my credit card bill. I was really con-
cerned about going into credit card debt and didn’t know how I would
come up with the money.

So I started by expressing my concern as a question: How can I make
$1,000 to pay my credit card bill? I brainstormed a list of things I
could do, narrowed it down, and started doing HTML/CSS/Dreamweaver
tutoring as a side job. Once I had a potential solution, I turned my
ques- tion into a clearly stated goal: “Make $1,000 doing web tutoring
by August 1.” It worked, and I now feel infinitely more creative when
it comes to solving financial issues.

EXERCISE: LIVING CREATIVELY

Make a list of problems or challenges you are facing at the moment (the
list doesn’t just have to be about money):

Looking for some extra income but can’t seem to think of a way to get
it without exhausting yourself at a second job? Try putting some of your
talents to use with the Craigslist-as-Dartboard approach. It involves
some high-tech trial and error.

7 steps to generate extra income through Craigslist:

1. Browse the services section (“lessons & tutoring” is a good
subset within services to start with).

2. Keep a list of any services that sound fun to you (and that you might
be qualified to do), like tutoring or dog walking.

3. Bookmark or copy posts you like into a separate document. Note what
you like about them (clearly written, interesting to read) and how much
people are charging for these services.

4. Narrow your list to two or three things you would be willing to try.
Write a post for each of those areas.

5. Post and wait to see if you get any responses!

6. If you start or complete a job and you don’t like it, treat it as a
learning experience.

7. Change direction altogether or tweak your offering to be more
specific.

List some activities (keep it legal, please!) that could help you
generate extra income:
________________________________________________________
________________________________________________________

Note: If you don’t have the time or energy to generate money through
services like tutoring, remember that selling things like clothes,
furniture, and old electronics on Craigslist or eBay can also be a great
way to earn extra cash.

DEEP DIVE: REWARD GOALS

When I was 20 years old I set a very specific goal. I filled up an
entire page of my journal with the following: “Five years from now, on
October 9 (my birthday), I will buy myself a diamond right-hand ring
worth at least $3,000.”

Oh, the frivolity! I set a number of other more serious goals at the
time, but this one was important because it symbolized independence,
indul- gence, and a reward for what I knew five years down the line
would be a job well done.

About one year after setting my goal, writing it down, and manifesting
my vision by cutting out pictures from magazines, I realized I hadn’t
actually taken any practical steps to make it a reality. So I set up a
sepa- rate savings account and had money direct-deposited once a month
to start building this fund. No matter what, I refused to cash out to
pay for other things (including the purchase of my condo or paying off
my credit card bill).

Once a goal has had five years to simmer and solidify, it means some-
thing. And writing something so specific made me steadfast in my resolve
to stick to it and reward myself, no matter how frivolous it seemed at
times.

Actually, the fact that I saved a little bit at a time over such a long
period made it seem less frivolous because I earned that money and
wasn’t pay- ing for the ring with borrowed debt. It taught me the
value of automatic saving, and seeing that I will not be spending my
retirement savings anytime soon, it gave me something to look forward
to.

Benefits of working toward a reward goal:

1. It will reinforce the structure and benefits of sound financial plan-
ning while giving you something fun to look forward to.

2. It feels so much more gratifying to earn an expensive gift or trip
through regular, consistent saving rather than buying it on credit.

3. It’s much more exciting than saving for retirement and definitely
has a faster turnaround time. Just make sure your first priorities are
still retirement and your emergency savings account; saving for a reward
goal without these systems defeats the purpose.

Steps to create your own long-term reward goal:

1. Identify something meaningful to you; something that is reward- ing,
exciting, and outside of your comfort zone for what you might normally
do or buy.

2. Write a time-bound goal with the dollar amount attached.

(Example: In January 2012 I will purchase an airline ticket to Africa
for a 3-week safari, at a total cost of $X,000.)

3. Divide your target dollar amount by the number of months from now
until your goal’s target date.

5. Set up a recurring, automatic deposit of $X/month (based on your
earlier calculation) from your regular checking account; I sug- gest a
few days after the first of the month. This allows your new sav- ings
account to take on a life of its own and grow without you having to pay
attention to it every month.

TWO CENTS FROM TWITTER

What’s your philosophy when it comes to saving and/or spending money?
Best tip?

@LMSandelin Depriving yourself completely is unrealistic—you work hard
for that money, but use it for something worthwhile.

@JReid_DevCab Money, unfortunately does make the world go round . . .
spend as little as you can until you have too much!

NOTABLE QUOTES

Don’t tell me where your priorities are. Show me where you spend your
money and I’ll tell you what they are. —James W. Frick

A penny saved is a penny earned.

—Benjamin Franklin

The poor, the unsuccessful, the unhappy, the unhealthy are the ones who
use the word tomorrow the most. —Robert Kiyosaki

You can only become truly accomplished at something you love. Don’t
make money your goal. Instead, pursue the things you love doing, and
then do them so well that people can’t take their eyes off you.
—Maya Angelou

Invest three percent of your income in yourself (self-development) in
order to guarantee your future. —Brian Tracy

Experience taught me a few things. One is to listen to your gut, no
matter how good something sounds on paper. The second is that you’re
generally better off sticking with what you know. And the third is that
sometimes your best investments are the ones you don’t make. —Donald
Trump

You aren’t wealthy until you have something money can’t buy.

—Garth Brooks

Of the billionaires I have known, money just brings out the basic traits
in them. If they were jerks before they had money, they are simply jerks
with a billion dollars. —Warren Buffett

You have not lived a perfect day, even though you have earned your
money, unless you have done something for someone who will never be able
to repay you. —Ruth Smeltzer

Ordinary riches can be stolen, real riches cannot. In your soul are
infinitely precious things that cannot be taken from you. —Oscar Wilde

Being rich is having money, being wealthy is having time.

—Margaret Bonnano

So many people spend their health gaining wealth, and then have to spend
their wealth gaining health. —A. J. Reb Materi

Wealth is a tool of freedom, but the pursuit of wealth is the way to
slavery.

—Frank Herbert

What’s money? A man is a success if he gets up in the morning and goes
to bed at night and in between does what he wants to do. —Bob Dylan

RECOMMENDED READING

Rich Dad, Poor Dad: What the Rich Teach Their Kids about Money—That
the Poor and Middle Class Do Not!

Allows you to check your credit score for free as often as you like,
track your credit scores over time and get credit advice.

AnnualCreditReport.com

Allows you to generate a free credit report from all three of the major
credit reporting agencies once a year. Note: You have to pay extra if
you want to see your credit score.

SmartyPig.com

A “social savings” account that allows you to set up savings
accounts for specific goals and share accounts with friends.

JustThrive.com

Also similar to Mint.com, Thrive brings all your credit card, checking,
savings, retirement, and investment accounts into one place so you can
“easily see what you have, what you owe, and where you can grow.”

BankRate.com

Financial calculators for everything from retirement to taxes to auto
loans and debt management.

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Author Profile

Jenny Blake

Jenny Blake is an author, blogger, life coach and sought-after speaker who helps others “Wake up, live big! and love the journey.” She has been featured on Forbes.com, US News & World Report, CNN.com and was recognized by Suze Orman as a leader among Gen Y. Jenny started her blog, LifeAfterCollege.org, in 2005 and recently translated it into a popular book, Life After College: The Complete Guide to Getting What You Want (Running Press, 2011), which serves as a portable life coach for 20-somethings. Jenny recently took her own great leap by leaving Google after five and a half years at the company (on the Training, Career Development and Authors@Google teams) to pursue her passions full-time. Follow her on twitter @Jenny_Blake.